ANTI-FRAUD SCHEMES. MAIN CONTENTS

Definition An Anti-Fraud Scheme is a system that provides for appropriate measures to protect the EU’s financial interests, including the prevention, detection and correction of conflicts of interest, corruption and fraud in the use of funds granted by the Recovery and Resilience Mechanism.

Are they mandatory?

Article 22 of Regulation 2021/241, as well as Article 6.1 of Order HFP/1030/2021 of 29 September, establish that all beneficiaries of NGEU funds are obliged to have an anti-fraud plan. When the Ministerial Order refers to ALL, it means all those involved as executors, including, of course, contractors and subcontractors.

The Anti-Fraud Measures Plan, or better known as PMA, as you will hear it being called, has the minimum requirements set out in section 5 of art. 6 of Ministerial Order 1030/2021.

What is the basic or essential structure of a PMA?

According to the wording of the Ministerial Order, the basic and essential structure of a PMA will be the following:

1. It will identify the risks

The first premise of a Plan of anti-fraud measures is to have the risks identified. By means of interviews and questionnaires, the areas where risks may occur, the foreseeable frequency and severity have to be analysed. Risks will be assessed especially with regard to conflict of interest, corruption and fraud, both in procurement, subsidies, staff recruitment and in the body as a whole.

2. Risk analysis

Once the risks have been identified, they have to be analysed/assessed. This involves an assessment of the impact and likelihood of the risk, as a minimum, especially with regard to conflict of interest, corruption and fraud. This mapping has to lead, as we will see in the corresponding section, to the definition of the necessary measures to establish the anti-fraud cycle.

3. Declaration of absence of conflicts of interest (DACI)

The signature/subscription of a DACI is mandatory. Each person involved in the management of the funds must sign this declaration. The DACI has to be part of the Anti-Fraud Action Plan. This obligation stems from article 6.5. and from Order HFP/1030/20121 of 29 September.

4. Defining measures

The Plan must establish the appropriate measures to prevent the risks detected from becoming a reality and from resulting in undesirable situations and events. The measures to be established are those of the anti-fraud cycle:

• Preventive measures (prevention)

These measures must be clearly defined so that the residual risk is tolerable. Likewise, procedures for the prevention and management of conflicts of interest must be designed.

• Measures for the detection of indications

The existence of red flag measures, including red flags, must be foreseen and the procedure for their implementation must be defined.

• Corrective measures

It has to incorporate the relevant corrective measures to be applied in case of detection

• Prosecution measures

It must set out the procedures for following up suspected cases of fraud and the corresponding mechanism for the recovery of fraudulently spent funds.

5. Monitoring and evaluation

Procedures for the review and evaluation of processes and controls must be defined, establishing the timing of this review, whether annually, at the end of each project, etc. The following must also be evaluated and taken into account in particular:

• The degree of implementation of the Plan
• The difficulties encountered, what and how they were overcome, and what was not.
• The effectiveness of the Plan in the fight against corruption and fraud in the management and execution of this fund.

The Plan of anti-fraud measures, once approved and in place, is never the end of the process, but must be the first step towards an Integrity Plan that covers the entire organization in the case of a public administration, and in the case of a non-public administration or private entity, the first step towards a crime prevention model.